HY-2011 Gold Revenue for Ghana Up 30 Percent

9/2/2011 5:16:44 PM

Revenue rise attributed mostly to high world prices.

Ghana's revenues from gold jumped more than 30 percent for the first half of the year on high world prices and a slight rise in output, the chamber of mines in Africa's No. 2 gold miner said on Friday.

Manganese output increased by 78 percent over the same period, increasing sales to $61.5 million. Meanwhile, diamond revenues rose 42 percent even though production was down by 8 percent, the chamber said in a statement.

Ghana late last year started producing oil and it is a top cocoa grower, making it one of Africa's brightest investment prospects.

"The rise in gold revenue was largely on account of its positively realised price - the marginal increase in gold output by 3 percent also contributed to the revenue increase," the chamber said.

Gold production for the first half of 2011 hit 1,497,023 ounces, up from 1,455,234 ounces a year earlier, with revenues during the same period jumping to $2.2 billion from $1.68 billion.

The chamber of mines said gold production fell on a quarter-on-quarter basis by 12 percent in the second quarter to 700,226 ounces from 796,797 ounces in the previous quarter.

It did not give a reason for the fall.

Manganese production rose to 1,003,103 tonnes for the first half of the year from 563,951 tonnes in the same period last year, contributing to a 65 percent jump in sales, according to the data.

The chamber said that diamond revenues were at $9.7 million for the period. "The 42 percent increase in diamond revenue was on account of the increase in the unit price, which more than compensated for its 8 percent dip in production," it said.

Underperformance in the bauxite sector, which saw shipments drop by 42 percent, translating into a 41 percent fall in revenues, clouded an otherwise rosy outlook.

The chamber linked this to "serious challenges" the Ghana Bauxite Company faced in transporting ore from its mine site to the port, some 240 km away.

"In the face of the inefficient rail service available, the company is compelled to transport the bulk of their production by road, which is relatively more expensive," the chamber said.